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Income Tax Act 2007

Income - Exempt income

CW 26D: Meaning of employee

You could also call this:

“This explains who is considered an employee when a company provides benefits”

When a company gives you something, the law needs to know if you’re an employee. Here’s what it means to be an employee in this case:

You’re an employee if a company employs you. But there are some exceptions. You’re not considered an employee if:

  1. You’re a director of the company, unless the company also employs you separately.
  2. You’re not a person, but instead you’re a corporation sole, a body corporate, or an unincorporated body.
  3. You, along with anyone associated with you, own 10% or more of the company’s issued capital.

This definition is used in section CW 26C of the law, which talks about income.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS32494.

Topics:
Money and consumer rights > Taxes
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Part C Income
Exempt income

CW 26DMeaning of employee

  1. For the purposes of section CW 26C, employee—

  2. means a person that is employed by a company; but
    1. does not include a person who,—
      1. is a director of the company, unless they are employed by the company:
        1. is a corporation sole, a body corporate, or an unincorporated body:
          1. with any associated person, holds 10% or more of the issued capital of the company.

          Notes
          • Section CW 26D: inserted, on , by section 35 of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).